Jul 21, 2009 06:58 PM
5549 Views
It was predicted to be the end of the "mom and pop shops" or what we commonly call as as the"kirana dukan". With retail chains Big Bazaar, Reliance Fresh, Spencer's setting up shop, it seemed tough for the smaller retail outlets and vegetable vendors. Just as it happened in the West, the smaller retail outlets were predicted to die out soon. But the reality is somewhat different, while Big Bazaar, Spencers, Reliance Fresh have established themselves well, the smaller unorganised retail sector has not yet died out. In fact it is still surviving and doing well enough. So what is the reason.
I think one reason is generally the topography of Indian cities and smaller towns, compared to those in the West. Walmart's entry in US led to the decline of the smaller "Mom n Pop shops", and the same thing was predicted to happen here in India. But there is a fundamental difference here, small towns in US, tend to be scattered, you have few houses here and there, and a shopping center. So generally people there drive down to the supermarkets, located in the shopping centers, and prefer to stock up for the month. In India the town architecture and the customer behavior are different. Towns in India generally tend to be clustered together, and so you have a small kirana dukan kind of setup, getting along, because he has got a ready customer base. Also unlike in US, not every customer in India, can afford to drive down, to the market, and stock up for the month. You have the working class, poorer people, who generally tend to purchase on a daily or weekly basis. They can't afford to buy for the month and stock up, so for such class of people, the "kirana dukans" would be more convenient.
Also shopping in larger supermarkets is dependent on your needs. If I need to purchase just a single toothpaste, it does not make sense, to go the supermarket, and buy the item and then wait in the checkout counter queue. In such a case I would prefer to pick it up from the neighborhood retailer. Again one more thing where the smaller retailers, score over the big retail chains is in quality of service. I have been to Big Bazaar, Spencers and Reliance Fresh, and I must say for sure, the quality of the sales personell is pathetic. Let me give one example. I was planning to buy a new Washing Machine, and we checked out the latest models in Big Bazaar, but the information we got was really poor. Most of them had no clue at all about the product. I then contacted another smaller electronics dealer near my home, and he gave me all the details up to date, helped us make our choice, and got the machine installed at our place. It is this lack of personal service which is a big issue with most of the major retail chains. Unlike in US, where the people in Walmart, would answer your queries properly, most of the sales people here are neither trained, nor can even communicate properly. In such a case, I would rather prefer my local retailer, who can give me a much better advice.
The retail chains should realize, that they can't keep attracting customers based on pricing and discounts alone. There are other factors like Quality of Service, Customer Friendliness which count too. Also one more thing is that the smaller retailers have become smarter, and they have started to adopt some of the practices of the bigger retail chains like door delivery. Big retail chains do have some advantages, lower pricing, better quality, and are quite useful when you need to stock up for the month. However they seriously need to imrpove their customer service, as well as the quality of the sales personell. Now when a customer is buying things like groceries or vegetables or toiletries, it might not matter. But for customers buying items like electronics or household appliances, you need a good sales person.
I guess right now both the larger retail chains and smaller ones would co exist. Its not like one would drive out another. And that is something to be welcomed.
